IPCC Costing & FM Preparation Tips – Nov 2016(Group 1 -Paper 3)
Get CA IPCC Costing & FM Preparation Tips for Nov 2016 Exam. Also read CA IPCC Business Law, Ethics & Communication Important Topics for Exam Preparation. For some students, CA IPCC Cost Accounting and Financial Management is a nightmare, while for some this subject is a cakewalk. With less than 3 months to go for November 2016 attempt, following tips can be followed to easily clear Cost FM exam. Though all these tips apply generally to other subjects as well but I’ll be specific about Cost FM in some cases. CA IPCC Cost Accounting & Financial Management is a bit tricky subject of IPCC. But Cost Accounting is simpler and easier than Financial Management. FM demands fundamental knowledge of each topic, so this can put some students in problem if they don’t know the basics of all the chapters.
CA IPCC Costing & FM Preparation Tips (Group 1 – Paper 3)
Toppers Tips for IPCC Costing & FM Exam Preparation
If you have problems in this subject, then you should follow the tips as given below:
- Padhuka book is the best for IPCC Costing & FM. So you should refer it. It contains past 60 exams questions and RTP.
- 6 Chapters out of 10 are easy and simple, so you should give first priority to that subjects for preparation. Then you should take another one. These 6 subjects will just take few days and you can complete it quickly, then you have to only revise it.
- Revision of all the topics are compulsory. If you lack in practice then there is no trick which can save you from this subject in IPCC.
- You should start your preparation with the Operating costing because it is a simple chapter a month the other costing chapters. In operating costing, sometimes questions are tricky. You can understand the pattern of tricks in the question with the proper revision.
- After completing Operating costing, you can start Standard costing but the thing is that one topic is quite similar to another topic. So if you get the concept “Material variance” properly then look into the “Labor variance”. These two are same.
- In Processing IPCC Costing, the topics at the beginning of the chapters are simple. You don’t have to give too much effort to do this part. Thus, the complicated part in this chapter is the “Equivalent Production”. If you face problem in this area then read the theory part slowly to understand the concept of equivalent production and then see the solved examples.
- When you are starting other chapters then please do the revision of the Standard costing and process costing side by side because questions often comes from these chapters and you should have a grip on standard costing and process costing.
Then after you should take the chapters like Marginal Costing and Material, Labour & Overhead, Contract Costing, Budgetary control, Integrated system and reconciliation.At last, I would like to say that any practical question requires smart analysis. The only thing you have to do is read the questions slowly and think how to solve it.
Important questions for CA IPCC Cost Accounting are as below:
Part 1: cost accountingProcess costingContract costingMarginal costing (may be with operating costing)Standard costing (may be with budgetary control)Integral and non-integral accounting OR Labour
Important questions for CA IPCC FM are as below:
Part 2: financial managementCost of capitalCapital structureCapital budgetingSources of finance (for theory)Working capital OR Leverages
Bonus Tips for IPCC Costing & FM Exam preparation
In this subject first of all theory part you have to prepare its nearly 32 marks, so just read the practice manual properly, most of the questions will be from it only. Theory will help for practicals also. ( eg ; If you read theory of Labour All methods of calculation of Wages will be understood, Material Formulas will be known, Contract A/c Ways of calculating the Profit will be understood.. So now it is clear Why Theory should be done first, & its Importance in this subject).If you are too good at Concepts & Practical then only Ignoring thorough study of theory can be thought else for average / bit above average student, Practical with proper study of theory only can Pass with 50 – 55 marks in this subject.In costing start with Standard Costing & Marginal costing then later Contact, process, material, labour, overhead and so..In FM, Capital budgeting & Cost of Capital are very vital chapters do them first, properly.then leverage, Ratios & Working Capital Management, Cash flow, fund flow and so..
Now Moving on to Preparation Part in Paper III:
- Start with Theory in any of the two subjects’ u wish, but preferably better to start with Financial Management as it is a Practical Subject u will become confident by choosing it First.
- Concentrate on the Topics which are applied in solving the problems as this enables u to solve the problems easily… along with an ability to write theory if asked in the exam
- Better if U read the theory chapter wise as reading all theory at a time doesn’t work..
2) Now Let’s move on to the Order of Preference to be chosen
a) First Start with Time Value of Money (an Easy and Important one ) – Base of Financial Management as it is applied in Capital Budgeting , Capital Structure Decisions which are major topics in Fm with this u will be able to solve the problems in these two chapters easily..b) Now Come on to Chapter IV Financing Decisions(Cost of Capital , Capital Structure Decisions , Leverages) take on the theory part and start solving problems on your own.(helps a lot)c) After on, take Investment Decisions which also carries more weightage follow the same rule as above Study the theory and apply thereond) Now,You have covered with the major topics lets move on to other topics Next it is better to choose Ratio Analysis In this Formulas Play a major role as Two-Four mark questions are asked on the simple formulas and most important is Advantages of Ratio Analysise) Now Move on to Cash Flow and Fund Flow Analysis for CFS much efforts are not required as it will be covered in Accounts Paper I just look at Funds Flow once..f) Now Last Part is Current Assets Managament i.e 1)Working Capital Management 2) Debtors ManagementIn this section in majority questions are asked on Deriving Working Capital(WC Statement) , Preparation of Cash Budget so concentrate more on these..
Practice the Problems in the Practice Manuals by the Institute it is enough no other Books are required
How to Prepare IPCC Costing Exam for Nov 2016
1) In Costing it is better to start with the basic concepts the problems are unpredictable i.e Start with Basic Concepts and understand the objective of the subject it will enable you to understand better the succeeding topics…2) Now Come on to Major costs i.e Material , Labour , Overheadsin these understand the following
- Materials – Control Mechanism to Prevent costs, Selection of Pricing while purchasing , Valuation Principles (FIFO,LIFO,WAM), Accounting Treatment for Material costs incurred
- Labour – Cost Control Techniques , Wage Payment Methods
- Overheads – Classification of Overheads ,Methods of Absorption of Overheads , Accounting and control of Overheads
3) Now , Take Methods of costing(I) i.e Job costing , Batch costing Contract costing etc.,4) Major Questions asked in the Methods of costing are from Contract costing.,5) Now the Last three chapters may be choosed as ur wish as choosing anyone doesn’t make any differenceNote:Important Thing to remember is that these chapters ( Standard Costing , Marginal Costing , Budgetary Control ) Carries a weightage of 20-25 Marks almost 40 % More Practice is required in these chapters6) At Last take on the Reconciliation of Cost Accounts with Financial Accounts as a finishing Step..
Preparation Strategies for IPCC Group 1 Costing & FM
Coaching Class: Regularity
If you opt for coaching classes, make sure you do not miss any class. Even if you do, keep track of what was missed, take backups and complete your notes simultaneously. It is also worth putting in an extra hour into the homework. Appear for all the tests even though you couldn’t prepare for it. If you have been attentive enough in the class, those tests might not be too difficult to solve.
Organization of Notes
Your notes should be properly maintained and complete. Like I mentioned earlier, complete your notes as and when you miss a class so that the pending work doesn’t get piled up in the end.
Once your notes are at one place, take a quick look at the whole syllabus and estimate how much time it can take to complete the entire course. Set daily, weekly or monthly targets. Keep in mind that when you start preparing for your attempt, it can take upto a whole month to set your routine. You also have to account for emergencies or other commitments. So set your schedule accordingly. Don’t worry if you are not able to stick to the schedule. With other subjects to study as well, it is a rare feat. Still, it helps to identify where you are lagging and how targets could be revised.Always remember, SETTING TARGETS IS A MUST.
Practice, practice and practice
- Practice each and every question from your books. Cost & FM is all about presentation, so focus on this aspect while practicing. Needless to say, mark those questions which you find important or difficult. Some students don’t calculate completely to save time while practicing. Do not do that. Solve every question till you get the final answer.
- Do not leave theory chapters for last few days. They generally carry a weightage of around 30 marks.
- Divide vast chapters like Capital Budgeting into sub parts. You can also prepare two topics simultaneously. For example you can cover Capital Budgeting from FM and relatively a short topic from Cost (say Reconciliation) side by side. This way you won’t be fed up doing a larger topic. But follow this approach only if you can manage it well. With enough on your plate already, you don’t want to end up getting confused.
Make a list of formuale and important concepts of every chapter. This will help in last minute revision.
PRACTICE IS THE KEY. This point cannot be stressed enough.
Once you are done with basic practice and revision, it is the time to start revising. Read all the concepts and solve all marked questions. Solve previous attempts’ as well as current attempt’s RTPs. Since Cost FM paper is always lengthy, it is a good idea to solve Mock Papers under exam conditions. This will help a lot in time management.Last but not the least, your confidence will matter the most during examinations. So have faith in yourself and give your best without worrying about the result.